Legal

High Court dismisses challenge to government extension of gas exploration licence

RoyalCourtsOfJustice

Photo: DrillOrDrop

A judge at the High Court has dismissed a case that the government acted unlawfully when it extended a licence to explore for gas in Cheshire.

ben-deanMr Justice Holgate ruled against the challenge, brought by anti-fracking campaigner, Ben Dean.

Mr Dean (left) had argued that the then Energy Secretary had no power in 2016 to extend the initial term of a Petroleum Exploration and Development Licence (PEDL) held by IGas.

At a judicial review hearing in June, he asked the court to quash the extension (DrillOrDrop report). If his case had been successful, there could have been implications for another 10 licences similarly extended at the same time.

But in a reserved ruling handed down yesterday, the judge accepted the government’s case and awarded costs of £5,000 against Mr Dean

Mr Dean said this afternoon he was disappointed by the ruling. He said his legal team would be examining the judgement in detail before deciding whether to seek leave to appeal.

Licence or contract?

pedl189

Map: UKOGL

The case centred on PEDL189, which covers the eastern half of the city of Chester, nearby Tarvin, where Mr Dean lives, and other villages including Mickle Trafford and Guilden Sutton.

The area included the IGas coal bed methane site of Dutton’s Lane, at Upton, where the company evicted a protest camp in 2016, before abandoned its drilling plans.

The PEDL was issued in 2008 to Dart Energy (West of England) Ltd, later taken over by IGas. Under the conditions of the licence, the initial term for exploration should have ended after five years in 2013. But the government extended the initial term for another three years to give the company more time to carry out an agreed exploration programme. A further two years were added in June  2016.

Mr Dean, represented by David Wolfe QC, argued that a PEDL was a statutory licence, governed by the 1998 Petroleum Act. The Secretary of State had power to vary conditions only in specific circumstances, he said. The conditions at the time did not allow for a variation to the length of the initial term, so the Secretary of State had no right to make the extension and had acted unlawfully.

He said the licence application made it clear that where companies did not complete the work by the end of the initial term they would lose the licence. The idea that the licence could be extended by a private agreement undermined the EU hydrocarbon licensing directive, which governed the application process.

The government, represented at the June hearing by Richard Palmer, argued that it was well-known in the industry that the duration of an initial term could be extended. This allowed flexibility where a licence-holder could not complete work for reasons beyond its control.

Ruling

In ruling against Mr Dean, Mr Justice Holgate accepted Secretary of State’s argument that the PEDL was a contract and the terms could be varied by agreement between the parties, like any other contract.

He concluded that a PEDL licence was not governed entirely by the statutory code.

“Rather it is a grant of exclusive rights to search for, bore and get petroleum, in other words a grant of exclusive property rights, which contains the normal incidents of property ownership, in so far as they are not excluded or modified by the terms of the legislation or the relevant licence.

“Those rights include the right to assign the interest created by the licence and the ability of the parties to the licence to agree to vary its terms.

“Neither the legislation to which the Court has been referred, nor the terms of PEDL 189, prohibited the variation which was made by the deed dated 28 June 2016.

“For all these reasons, that variation was lawful.

“I reject the various grounds upon which the Claimant has contended that the deed of variation executed on 28 June 2016 was ultra vires and so the application for judicial review is dismissed.”

Friends of the Earth

Mr Dean’s case was supported by Friends of the Earth. Its lawyer, William Rundle, said today:

“We are hugely disappointed that Ben Dean has lost his case and the threat of fracking still hangs over his community in Cheshire.

“We will be discussing with Ben and his barrister any appeal and will continue to support him at this time.

“But whatever happens, the fight against risky and unnecessary fracking will continue, both in Cheshire and in communities across the country.

“This includes holding government to account when they act unlawfully, as we believed that they did here, because of how they managed this operator’s licence”.

Link to the court papers

DrillOrDrop report of the judicial review hearing

50 replies »

  1. The motor just proves how easily fooled some are. Like a grape in a Shiraz and the same grape in another wine means it is the same wine. And the BBC reporting on our new 650,000 !! tonne aircraft carrier today, and that it is a lot to pay for a vessel that needs other vessels to protect it (since when did an aircraft carrier not require that?)

    (See another Labour Minister resigned today, because she was correct, but politically incorrect-is the Shadow Justice Minister still around? She/he seems to have it the other way round, but then old 5% Len comes into the equation.)

    There is no inescapable point refracktion. I conducted market research to examine customer price elasticity (largely) and if I was saying to them the product, and it’s benefits (financial or other) was unavailable and unknown for the foreseeable future, those customers (surprise?) were not that enthusiastic. As soon as a benefit could be ascribed the result was much more dynamic. My products were a minor expenditure, energy costs are a different magnitude all together. I’m surprised under the given circumstances that we are at two thirds.

    Will Cuadrilla be able to follow that through? I’m not sure. But, Ineos will, together with other very obvious marketing policies, which I will not bore you with. Don’t get carried away by ancient mutterings from Centrica regarding economics. They are the owners of British Gas. Does anyone really believe they would indicate household bills might reduce, under any circumstances? Probably a P45 offence.

    Trying to avoid Gordon Brown’s mantel, but suggest a long term commitment to an electric replacement for your diesel may be another confusion. Suspect the more viable alternative will be hydrogen from that horrible fossil fuel. With Trillions of £/$ committed to fossil fuel, that is a “horse” I can see muscling past electric vehicles. Maybe Jim sees the same picture? Electric vehicles IMO will be short term fix, which is almost guaranteed now a political party is pushing them ahead. But, unlike Gordon, I would suggest you do your own research-Oxford and Cambridge Universities could be a good starting point.

  2. “Like a grape in a Shiraz and the same grape in another wine means it is the same wine.” Do you really not know that shiraz IS a grape Martin? LOL

    Interesting news tonight in both the Telegraph and the Scottish Herald about Prof John Underhill’s comments about British geology meaning fracking is a waste of time (my paraphrase). Oddly both articles appear to have been deleted as quickly as the Telegraph removed a reference to Cuadrilla causing the Preese Hall earthquake recently.

    What was that about a free press?

    Fortunately archives come to our rescue

    https://archive.is/3tlDv#selection-2637.1-2637.21

    and

    http://webcache.googleusercontent.com/search?q=cache%3AkNaT6HWphbIJ%3Awww.telegraph.co.uk%2Fbusiness%2F2017%2F08%2F16%2Fuk-shale-overhyped-unlikely-deliver-geologists-warn%2F

  3. Prof Underhill is incorrect in saying we import significant pipeline gas from Russia. This is not reflected in the UKGOV statistics published last month, https://www.gov.uk/government/statistics/digest-of-uk-energy-statistics-dukes-2017-main-report , or in recent years. He is correct about the UK’s exposure to import dependency and the fundamental need for gas. He is correct about the basins in the UK being more structurally complex, and having a different burial history, than the classic shale gas basins of the USA. He uses, as his prime example, the Weald Basin, without mentioning that the BGS resource assessment had already shown that basin to be a poor prospect for shale gas. Industry is well aware of the geological issues in the UK, hence the need to drill and test. So let’s get on with it!

    • Thanks Dr Many Letters.

      So why in your opinion were two newspaper articles pulled like that then? It seems very strange as you seem to saying his findings are pretty non-contentious.

      • refracktion. I have no idea why newspapers pull stories. It has happened to me, even when I have been contacted by a newspaper to help write a story. Editors make choices for all sorts of reasons & news can be fast moving. By the way, thanks for the nickname Dr Many Letters; do you have relevant professional qualifications???

        • Me too – life’s a bitch isn’t it? I wasted a whole morning with Tim Webb from the Times a couple of years back but it seems the content he got didn’t match the story he wanted to write so it never saw the light of day. It doesn’t normally happen on line after publication though.

          Glad you like the nickname Nick. I just have my experience as a business analyst to help me sniff out b/s Nick – I am nowhere near as clever as you obv. 😉 Actually it was just a gentle dig at you for adding them to your ID here. It seems a bit like when recent graduates get their first business cards printed and get “BSc Hons” put after their names. It doesn’t normally last more than a couple of years in their case.

          • refracktion, I add my professional qualifications as social media is full of opinions from people who consider themselves experts, but are not. So I do not see why I should not clearly flag my hard won credentials & experience. I don’t even use a nom de plume (unlike yourself)

            • [Edited by moderator]

              All opinions on here are valid, academic or no; odd or not. It’s what makes the world a better place, communication, sharing of information different views and opinions.

              “This”, cried the Mayor, “is your town’s darkest hour!
              The time for all Whos who have blood that is red
              To come to the aid of their country!” he said
              So, open your mouth lad! For every voice counts!”
              Dr Seuss – Horton Hears a Who

  4. I wondered who would grasp the Prof. Underhill remarks!

    He may actually have a point, but equally, he may be wrong. It is not a new point, quite an old one, and one that many acquiring or adding to criminal records, and presumably part of the one third, don’t seem to agree with.

    What is certainly not factual is that this is Plan A. The development speed and support from authorities clearly show it isn’t. But it is as Cuadrilla state, the reason that test wells need to be drilled. Gas is certainly there within UK shale, whether it is there in sufficient quantity and easily extracted is what is to be tested.

    I’m sure that with every conventional oil or gas well about to be drilled there is at least one similar expert saying nothing will be found of any consequence. Sometimes they are correct, sometimes the other experts employed or consulting those drilling are correct. Bit like the expert economists predictions prior to the EU Referendum.

    Shame the remarks were not a few years ago. All that expenditure of time and money by the antis could have been avoided, and whole plantations of lemons could have, instead, found their way into G&Ts..

    • On behalf of the four fifths I would say if someone told you that you would burn your hand if you poured boiling water over it I would be inclined to listen and stop…..
      Let’s focus on what IS there and continue with renewable. Yes changes will have to be made to people’s mentality and energy addiction (or not as technology improves Mr Musk & co), but we did it before, from wood, to coal and steam to gas and nuclear; its now the turn of wind and solar and even back to water as was a reliable power source for many of the mills.
      Money is the only thing stopping the sensible changes; money stuck in ‘dead’ assets of oil and gas. Shale gas lobbyists talk about change in attitudes but still live in the twentieth century; catch up, put up and move on. Gas is dead, long live the sun.

  5. [Edited by moderator]

    we have Sherwulfe, salivating over Mr.Musk, who is still losing money hand over fist, and raising more, yet pontificating about money stuck in “dead” assets of oil and gas! Funny how some of those “dead” assets still manage to pay the highest dividends to investors, so how is it stuck?

    Off to play football with the dog-he thinks he is Ronaldo, and is probably not too far wrong, as he will not pass the ball!.

    • Well if nobody else will play with you Nipper is your pal! You must be starting to understand what it’s like to be a fracker – no mates and no chance of a game 😉

    • You mean those super duper shares in I gas, no dividend paid since god knows when; AJ Lucas…much the same; yawn

      I wonder how much Cuadrilla has ‘lost’ to date?

      Good Energy Shares, now there’s a good investment…..

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s